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Commissioner, 76 T.C. 468, 481 (1981), affd. without published
opinion 720 F.2d 664 (3d Cir. 1983). Accordingly, except for the
$290 contribution to the United Christian Church, which
respondent concedes, we hold for respondent on this issue.
Turning to the mortgage interest, the parties do not dispute
that petitioner may deduct the interest that she paid on her
primary residence and one other California property.3 See
sec. 163(h)(2)(D). The parties lock horns on the interest paid
on the remaining two Californian properties. Petitioner asserts
that this interest is deductible as interest on properties held
out for rental; i.e., investment interest. Petitioner argues
that her lottery winnings are investment income that can be
offset by this investment interest expense.
We disagree with petitioner that the interest on the other
properties is deductible as investment interest. We are unable
to find in the record that petitioner ever held any of these
properties out for rental or otherwise held them as an
investment. Petitioner's brief, on this issue, is directed
entirely towards her assertion that lottery winnings are a form
of investment income. We need not decide that issue, however,
2(...continued)
A.F. & A.M. Inc., we note that the record does not indicate that
this lodge was a qualified recipient under sec. 170(c)(2).
3 We understand the parties' agreement to mean that
petitioner may deduct the mortgage interest paid with respect to
331 West 46th Street ($10,913) and Salter Road ($23,994).
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